(Bloomberg) -- About 50 Credit Suisse Group AG bankers are suing Switzerland’s financial regulator for rendering their bond-based bonuses worthless as part of the stricken lender’s state-brokered takeover by UBS Group AG.

The staff are suing over the writedown of so-called contingent capital awards based on a risky category of bonds known as Additional Tier-1s, according to a spokesman for the Swiss Federal Administrative Court, who declined to give details on timing of the claims.

The employees are split into three groups, the court spokesman said. One is represented by the firm of Nater Dallafior, according to a person familiar with the litigation who spoke on condition of anonymity. The Zurich law firm declined to comment.

Read more: Call Them CoCos or AT1s, Here’s Why They Can Blow Up: QuickTake

The fate of the bond-linked bonuses has been one of the legal flash points since the emergency rescue and UBS takeover in March. Credit Suisse last week withdrew an appeal over the writedown of the awards. Before backing down, the Zurich-based bank had argued that the wipeout of the AT1s shouldn’t apply to the CCAs because they were not issued by the lender but awarded by other companies in the banking group. 

Credit Suisse declined to comment on the reasons for dropping its case or on the bankers’ lawsuits. The bank is restricted due to the terms of the merger agreement to not take any legal steps that could jeopardise the government-brokered rescue.

Created after the 2008 financial crisis, AT1s are the lowest rung of bank debt, producing juicy returns in good times but taking the first hit when a bank runs into trouble. Even shareholders — often the first domino to fall in such situations — salvaged some value from the takeover engineered by Swiss authorities, while Credit Suisse’s AT1 holders walked away with nothing. 

Read More: Swiss Defend $17 Billion AT1 Wipeout in Credit Suisse Takeover

The Swiss federal court has received at least 230 appeals representing about 2,500 claimants who saw the value of their bonds written down to zero. They argue the write down of $17 billion worth of bonds was an unfair and disproportionate move that put shareholders before bondholders, contrary to the conventions of insolvency proceedings. 

Defenders of the decision by the regulator, Finma, point out that the risk of a writedown was clearly laid out in the bonds’ fine print.

Finma declined to comment on the cases. It has previously published its position on the writedown, explaining that it was part of a takeover plan that was the least bad option after it and the government rejected a wind-down of Credit Suisse or temporary nationalization.

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